Bitcoin is torn between capitulation or recovery after its latest blow
How low will the Bitcoin price go in 2023? That is one of the main questions that many market experts and followers are asking for the coming months. After an abysmal year, analysts keeping their visions about where the biggest cryptocurrency is headed next year, and the price targets are mostly bleak. Digital assets have had a historically bad 2022, with the capitalization of cryptocurrency market falling below from 800,000 million dollars from almost three trillion dollars in November 2021. Bitcoin has lost more than 75% During the same period of time. This drastic drop in crypto asset prices occurred alongside a decline in the stock market, where the Dow Jones Industrial Average (DJIA) and the S&P 500 fell together amid higher interest rates and recessionary economic concerns, hurting risk-sensitive assets. But the cracks within the ‘crypto world’ itself, since the collapse of the Terra stablecoin ecosystem until the bankruptcy of FTX, have exacerbated the losses, what has caused a new ‘crypto winter’ and has pushed many investors to abandon the space altogether. It is what some see as the initial symptoms of a capitulation that could arrive throughout 2023.[trading type=”single-ticker” symbol=”BITSTAMP:BTCUSD”url=”https://www.lainformacion.com/tags/bitcoin-btc/”][trading type=”en-tiempo-real” symbol=”BITSTAMP:BTCUSD”]Yuya Hasegawa, an analyst at the Bitbank exchange, believes that the biggest challenge for digital assets is the macroeconomic context, that is, how much the more the Federal Reserve will raise interest rates while fighting inflation, and whether that will cause a recession. “I don’t see that fight triggering a market panic or crash, but it will continue to deter risk sentiment in the investment space that has already been holding. Trust issues due to series of shocks that happened this year,” he comments, noting how Terra, the ripple effect associated with its collapse, and the recent FTX implosion, have plagued cryptocurrency investors for months. “The great crypto winter of 2022 will continue through the first half of 2023 and it is bitcoin likely to fluctuate without clear directions”, Hasegawa expose. The analyst points to a wide range for this currency for 2023, which could make prices fall more than 50% from current levels or, in the most bullish case, make some progress towards the late January 2021 record near $69,000. Hasegawa sees the range for the benchmark cryptocurrency for a June 2023 is from 8,000 to 25,000 dollars, and the image would recover in the second half of next year, where the expert points to Bitcoin between 20,000 and 50,000 dollars. This bullish scenario depends on a series of factors both intrinsic and extrinsic to digital assets. I think that Fed will have to stop raising interest rates starting next May, and risk sentiment will start to improve from the second half of 2023, with possible rate cuts in the offing by early 2024,” Jefferies says in a recent report focusing on the crypto market. The research firm adds that investors can start pricing in the ‘halving’, scheduled for May 2024, near the end of next year; this event refers to an adjustment to bitoin mining rewards that effectively slows down new issuance. Katie Stockton, Managing Partner, Technical Analysis Group, Fairlead Strategies different set of forecasts based on technical analysiswhich focuses on market data trends. “Bitcoin would face short-term resistance around $16,800, which is a level that marks its 50-day moving averages,” according to Fairlead. But it could get worse. “We remain bearish in the short term,” Stockton said. “We expect the negative momentum to pick up after the positive seasonal influences wear off in early January,” he says. Fairlead expects Bitcoin to test its level of initial support around $15,600 in the coming weeks, “which will likely lead to a decline targeting long-term support near 13,900, defined by the 2019 high,” Stockton says. “Long-term negative momentum continues to be a drag, since oversold conditions in the long term it is absorbed without a significant rebound”, he deepens.